OPEN-SOURCE SCRIPT
Market Gravity: Relative Value Engine
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**Relative Value Model (Enhanced)**
This indicator calculates a statistically-derived fair value for your asset by modeling its historical relationship with a reference symbol (default: USDT Dominance). It supports three model types — Linear Range, Linear Regression, and Logarithmic Range — and outputs a prediction line, residual bands, Z-Score signals, and a full metrics dashboard.
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**What Does This Indicator Do?**
This indicator builds a statistical price model output by comparing your current chart's price to a reference symbol. It calculates what your asset's price *should* be based on the historical relationship between the two symbols, then measures how far the actual price deviates from that prediction. In short: it answers the question — *"Is this asset overvalued or undervalued relative to a correlated market driver?"*
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**How the Three Models Work**
**Linear Range**
Maps the reference symbol's high/low range to the current chart's high/low range using a simple slope/intercept formula. Best for assets that move in proportion to the reference linearly.
**Linear Regression (Correlation)** *(Default)*
Uses Pearson correlation, standard deviation, and rolling means to calculate a beta (slope) and alpha (intercept) — essentially a rolling OLS regression. This is the most statistically rigorous method and handles non-proportional relationships better.
**Logarithmic Range**
Performs the same range mapping as Linear Range but in log space, then exponentiates back. Ideal for assets with exponential price behavior (e.g., crypto over long timeframes).
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**Dashboard Panel — What Each Row Means**
**Regime** — Whether price is above (Premium) or below (Discount) the model. Green = overpriced vs model; Red = underpriced.
**Diff %** — Percentage deviation of actual price from predicted price. +5% means price is 5% above the model estimate.
**Prediction** — The model's estimated fair price for the current bar. Your fair value anchor.
**Z-Score** — How many standard deviations price is from the prediction. Above +2 or below -2 is considered statistically extreme.
**Z-Score State** — Normal or Extreme based on your threshold setting. Extreme signals a potential mean-reversion setup.
**R²** — R-squared, goodness of fit from 0 to 1. ≥0.6 = Strong, 0.35–0.6 = Moderate, below 0.35 = Weak. Only trust the model when quality is at least Moderate.
**Model Quality** — Text label derived from R². Use signals only when this reads Moderate or Strong.
**MAE** — Mean Absolute Error in price units. Lower = model tracks price more closely.
**MAPE %** — Mean Absolute Percentage Error. Lower percentage = more accurate model overall.
**Smoothing** — Shows the active moving average type and length applied to the prediction line.
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**Visual Elements on the Chart**
- Yellow line — The predicted fair-value price line
- Aqua bands — Upper and lower residual bands (predicted ± multiplier × standard deviation). Price outside these bands is statistically stretched.
- Green fill — Premium zone, price is above the model
- Red fill — Discount zone, price is below the model
- LONG label — Price crossed above the prediction line, bullish regime shift
- SHORT label — Price crossed below the prediction line, bearish regime shift
- Z+ triangle — Z-Score crossed above the extreme threshold, potential reversal warning
- Z- triangle — Z-Score crossed below the negative threshold, potential reversal warning
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**Settings Guide**
*Data and Model*
- Reference Symbol: Default is USDT Dominance. Try DXY, SPX, BTC, or any asset correlated to your chart.
- Reference Timeframe: Leave blank to match your chart, or set a higher timeframe for macro-level signals.
- Model Type: Start with Linear Regression. Switch to Logarithmic Range for crypto on long-term charts.
- Lookback Period: Use 10–20 on lower timeframes (1H, 4H), and 50–100 on daily or weekly charts.
*Smoothing*
- Smoothing Type: EMA reacts faster, RMA is smoother, None gives the raw model output.
- Smoothing Length: Increase to reduce noise, decrease for more responsiveness.
*Signals and Risk*
- Residual Band Multiplier: Default 1.5. Try 1.0–2.5. Higher = wider bands, fewer signals.
- Z-Score Threshold: Default 2.0. Use 1.5 for more frequent signals, 2.5 for rarer and stronger ones.
*Visualization*
- All colors, band visibility, and panel on/off are fully customizable. Auto theme detects your chart background automatically.
---
**Built-in Alerts**
Three alert conditions are included:
1. Z-Score Premium Threshold Crossed — price enters extreme overvalued territory above the model.
2. Z-Score Discount Threshold Crossed — price enters extreme undervalued territory below the model.
3. Price Crossed Model — price crosses the prediction line in either direction, possible regime change.
To activate, go to Alerts → Create Alert → Condition → select this indicator.
---
*This indicator is for educational and analytical purposes only. Not financial advice.*
**Relative Value Model (Enhanced)**
This indicator calculates a statistically-derived fair value for your asset by modeling its historical relationship with a reference symbol (default: USDT Dominance). It supports three model types — Linear Range, Linear Regression, and Logarithmic Range — and outputs a prediction line, residual bands, Z-Score signals, and a full metrics dashboard.
---
**What Does This Indicator Do?**
This indicator builds a statistical price model output by comparing your current chart's price to a reference symbol. It calculates what your asset's price *should* be based on the historical relationship between the two symbols, then measures how far the actual price deviates from that prediction. In short: it answers the question — *"Is this asset overvalued or undervalued relative to a correlated market driver?"*
---
**How the Three Models Work**
**Linear Range**
Maps the reference symbol's high/low range to the current chart's high/low range using a simple slope/intercept formula. Best for assets that move in proportion to the reference linearly.
**Linear Regression (Correlation)** *(Default)*
Uses Pearson correlation, standard deviation, and rolling means to calculate a beta (slope) and alpha (intercept) — essentially a rolling OLS regression. This is the most statistically rigorous method and handles non-proportional relationships better.
**Logarithmic Range**
Performs the same range mapping as Linear Range but in log space, then exponentiates back. Ideal for assets with exponential price behavior (e.g., crypto over long timeframes).
---
**Dashboard Panel — What Each Row Means**
**Regime** — Whether price is above (Premium) or below (Discount) the model. Green = overpriced vs model; Red = underpriced.
**Diff %** — Percentage deviation of actual price from predicted price. +5% means price is 5% above the model estimate.
**Prediction** — The model's estimated fair price for the current bar. Your fair value anchor.
**Z-Score** — How many standard deviations price is from the prediction. Above +2 or below -2 is considered statistically extreme.
**Z-Score State** — Normal or Extreme based on your threshold setting. Extreme signals a potential mean-reversion setup.
**R²** — R-squared, goodness of fit from 0 to 1. ≥0.6 = Strong, 0.35–0.6 = Moderate, below 0.35 = Weak. Only trust the model when quality is at least Moderate.
**Model Quality** — Text label derived from R². Use signals only when this reads Moderate or Strong.
**MAE** — Mean Absolute Error in price units. Lower = model tracks price more closely.
**MAPE %** — Mean Absolute Percentage Error. Lower percentage = more accurate model overall.
**Smoothing** — Shows the active moving average type and length applied to the prediction line.
---
**Visual Elements on the Chart**
- Yellow line — The predicted fair-value price line
- Aqua bands — Upper and lower residual bands (predicted ± multiplier × standard deviation). Price outside these bands is statistically stretched.
- Green fill — Premium zone, price is above the model
- Red fill — Discount zone, price is below the model
- LONG label — Price crossed above the prediction line, bullish regime shift
- SHORT label — Price crossed below the prediction line, bearish regime shift
- Z+ triangle — Z-Score crossed above the extreme threshold, potential reversal warning
- Z- triangle — Z-Score crossed below the negative threshold, potential reversal warning
---
**Settings Guide**
*Data and Model*
- Reference Symbol: Default is USDT Dominance. Try DXY, SPX, BTC, or any asset correlated to your chart.
- Reference Timeframe: Leave blank to match your chart, or set a higher timeframe for macro-level signals.
- Model Type: Start with Linear Regression. Switch to Logarithmic Range for crypto on long-term charts.
- Lookback Period: Use 10–20 on lower timeframes (1H, 4H), and 50–100 on daily or weekly charts.
*Smoothing*
- Smoothing Type: EMA reacts faster, RMA is smoother, None gives the raw model output.
- Smoothing Length: Increase to reduce noise, decrease for more responsiveness.
*Signals and Risk*
- Residual Band Multiplier: Default 1.5. Try 1.0–2.5. Higher = wider bands, fewer signals.
- Z-Score Threshold: Default 2.0. Use 1.5 for more frequent signals, 2.5 for rarer and stronger ones.
*Visualization*
- All colors, band visibility, and panel on/off are fully customizable. Auto theme detects your chart background automatically.
---
**Built-in Alerts**
Three alert conditions are included:
1. Z-Score Premium Threshold Crossed — price enters extreme overvalued territory above the model.
2. Z-Score Discount Threshold Crossed — price enters extreme undervalued territory below the model.
3. Price Crossed Model — price crosses the prediction line in either direction, possible regime change.
To activate, go to Alerts → Create Alert → Condition → select this indicator.
---
*This indicator is for educational and analytical purposes only. Not financial advice.*
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For help and support, feel free to contact:
wa.me/905469061306
wa.me/905469061306
Penafian
Maklumat dan penerbitan adalah tidak bertujuan, dan tidak membentuk, nasihat atau cadangan kewangan, pelaburan, dagangan atau jenis lain yang diberikan atau disahkan oleh TradingView. Baca lebih dalam Terma Penggunaan.
Skrip sumber terbuka
Dalam semangat TradingView sebenar, pencipta skrip ini telah menjadikannya sumber terbuka, jadi pedagang boleh menilai dan mengesahkan kefungsiannya. Terima kasih kepada penulis! Walaupuan anda boleh menggunakan secara percuma, ingat bahawa penerbitan semula kod ini tertakluk kepada Peraturan Dalaman.
For help and support, feel free to contact:
wa.me/905469061306
wa.me/905469061306
Penafian
Maklumat dan penerbitan adalah tidak bertujuan, dan tidak membentuk, nasihat atau cadangan kewangan, pelaburan, dagangan atau jenis lain yang diberikan atau disahkan oleh TradingView. Baca lebih dalam Terma Penggunaan.